Belgium supports the European Commission's proposal to grant more budgetary flexibility to EU Member States investing more in defence, Budget Minister Vincent Van Peteghem (CD&V) has confirmed.
However, Van Peteghem added that this measure alone will not suffice and the EU must also consider a common financial instrument upon his arrival at a Eurogroup meeting in Brussels on Monday.
On Friday, European Commission President Ursula von der Leyen proposed activating "the derogation clause for defence investments" within the European budgetary framework.
This will allow Member States to significantly increase their defence spending "in a controlled and conditional manner," according to von der Leyen.
Budget Minister Vincent Van Peteghem. Credit: Belga
Exceptional circumstances
During the Covid-19 pandemic, the EU activated a general derogation clause for member states to provide significant support to their economies. The clause discussed on Friday would be limited to defence investments.
Granting additional budgetary flexibility at the national level is one option the EU is exploring to finance increased defence investments. "But this should not be the only measure," stated Van Peteghem.
"We must also consider other possibilities, such as a common European financial instrument," he said.
Such an instrument, which could theoretically take the form of a new common loan, typically faces resistance from fiscally healthier Member States, while the more indebted ones are more favourable to it. For instance, Italian Prime Minister Giorgia Meloni voiced her support for the measure on Friday.
The upcoming debate on the post-2027 EU budget framework (CFP) brings these options back onto the table.
Belgium, like other countries, also supports increased investments in the European defence industry through the European Investment Bank (EIB).
In its coalition agreement, the Belgian Federal Government plans to refinance defence through a new fund financed by asset sales. It has committed to an accelerated growth trajectory towards 2% of GDP for defence spending by 2029 and 2.5% by 2034.
